Makes it easier to be professional Q2 218 report presentation July 19, 218 1
Q2: High demand, successful initiatives and strong results Strong organic growth at 8% EBITA margin 8.4% (8.2) Sales up by 18% to 8 56 MSEK EBITA up by 21% to 678 MSEK Strong market Successful initiatives & positive effect from acquisitions Positive Easter effect Diluting effect of acquisitions Strong market Continued high pace of sales initiatives 2
Q2: Strong sales growth, primarily driven by organic growth Sweden +16% / +8% Norway +28% / +9% Finland +15% / +5% Sales growth / organic +18% / +8% Underlying market conditions remained strong Construction still strong, however, declining number of housing starts Renovation growth accelerating Industry strong Growth positively affected by acquisitions, working days and currency MSEK MSEK Sales bridge Growth in MSEK and % +18% 8 5 +5% +8% +2% +2% 8 56 8 136 161 7 5 62 7 157 7 6 818 339 MSEK Q2 217 Acquisitions Q1 217 Pf Organic Trading days Currency MSEK Q2 218 Sales bridge per market segment Growth in MSEK and % +18% 8 5 +1% +5% +2% % % 8 8 56 124 22 34 7 5 362 MSEK 7 6 818 695 MSEK Q2 217 Sweden Norway Finland Denmark Other Q2 218 3
Q2: Profitability at high level Sweden +11.7% (12.) Norway +3.6% (2.) Finland +3.2% (2.6) EBITA margin +8.4% (8.2) Gross margin at 26.3% (26.8) EBITA margin at 8.4% Dilution from acquisitions Continued high pace of sales initiatives Positive currency effect of MSEK 5 Sales, EBITA and EBITA margin 1 8 6 4 2 8 56 7 66 6 92 6 344 6 568 6 818 7 161 6 492 5 88 5 48 8.2 8.4 397 56 538 563 53 558 597 79 554 678 218Q2 218Q1 217Q4 217Q3 217Q2 217Q1 216Q4 216Q3 216Q2 216Q1 Adjusted EBITA margin, % Net sales, MSEK EBITA, MSEK EBITA margin, % EBITA bridge Growth in MSEK and % +21% +59% -7% -31% 1 4 8 331 171 678 6 558 4 2 Q2 217 Net sales effect Gross margin effect Operating expenses Q2 218 16 14 12 1 8 MSEK 6 4 4
H1: Strong sales growth both organic and acquired Sweden +14% Norway +13% Finland +13% Total sales growth +14% Strong sales growth Both organic and acquired Underlying market conditions remained good Construction still strong, however, declining number of housing starts Industry remained strong Stable development in infrastructure MSEK Sales bridge Growth in MSEK and % +14% +5% +8% % +1% 15 5 15 217 15 26 147 14 5 1 97 13 998 14 612 13 5 13 387 MSEK MSEK MSEK YTD 217 Acquisitions Q1 217 Pf Organic Trading days Currency YTD 218 Sales bridge per market segment Growth in MSEK and % +14% +9% +3% +1% % % 15 5 15 217 48 15 21 28 361 MSEK 14 5 14 1 192 13 5 13 387 MSEK YTD 217 Sweden Norway Finland Denmark Other Q2 218 5
H1: EBITA up by 13%, driven by increased sales Sweden 11.6% (12.) +14% EBITA margin 8.1% (8.1) Sales, EBITA and EBITA margin 16 14 12 1 8 6 4 2 12 782 13 387 11 824 8.1 957 1 11 1 88 217H1 216H2 216H1 14 98 1 36 217H2 15 217 8.1 1 231 218H1 16 14 12 1 8 6 4 2 Norway 2.8% (2.4) +15% Finland Finland 2.6% (2.3) +7% Strong net sales effect Stable gross margin Increased operating expenses due to volume increase, acquisitions and market initiatives Adj. EBITA margin, % Net sales, MSEK EBITA, MSEK EBITA bridge Growth in MSEK and % +13% 2 +45% -4% -28% 1 5 4 493 31 1 88 1 5 EBITA margin, % 1 231 Q2 217 Net sales effect Gross margin effect Operating expenses Q2 218 6
In total ~796 MSEK in 218 YTD - Acquisitions ~36 MSEK acquired annual sales ~455 MSEK acquired annual sales ~35 MSEK acquired annual sales Of which 35 MSEK closed in July High acquisition activity in combination with organic initiatives bodes well for future profitable growth 7 Estimated net sales (RTM) at acquisition date
Sweden Highlights Q2 Strong demand and continued high growth in all product segments Strong development in all product segments Remained high demand in new construction Growth rate in renovation increasing Strong demand from industry customers Successful customer initiatives within SME, private label and PPE One acquisition within Tools & Supplies with ~3 MSEK in annual sales: Bygg & Industripartner Sales, EBITA and EBITA margin 6 5 4 3 2 1 5 14 5 18 4 758 4 51 4 484 4 12 4 261 4 22 3 572 3 699 12, 11,7 391 522 451 573 51 537 515 651 545 65 218Q2 218Q1 217Q4 217Q3 217Q2 217Q1 216Q4 216Q3 216Q2 216Q1 Adj. EBITA margin, % Net sales, MSEK EBITA, MSEK EBITA margin, % Sales bridge Growth in MSEK and % 16 14 12 1 8 6 4 EBITA up 13% Higher sales growth in segments with lower margins 5 2 +16% +8% +5% +2% 86 5 18 Acquisitions, growth initiatives and a high level of activity impacted negatively EBITA margin at 11.7% (12.%) 5 4 8 4 6 4 484 393 216 Q2 217 Organic Acquisitions Trading days Q2 218 8
Norway Highlights Q2 Strong growth and successful customer targeting Sales up 28%, of which 9% organic - Two more trading days and lack of Easter effect contributed Strong demand from industry Positive trend in construction Strong organic growth in Electrical The acquisition of Bekken & Strøm developed well One acquisition within Tools & Supplies with ~4 MSEK in annual sales: Sentrum Motor og Verktøy EBITA margin at 3.6% (2.) Strong sales in segments with lower gross margin Two more trading days and lack of Easter effect had a significant positive impact of MSEK +14 Positive effect from sale of property: MSEK +13 and positive currency translation: MSEK +2 Transaction costs of MSEK -3 related to acquisitions Sales, EBITA and EBITA margin 1 8 1 674 1 6 1 375 1 39 1 393 1 389 1 4 1 267 1 312 1 254 1 185 1 2 1 82 1 3.6 8 6 4 2 2. 13 25 53 51 39 26 65 48 25 6 216Q1 216Q2 216Q3 216Q4 217Q1 Adj. EBITA margin, % Net sales, MSEK EBITA, MSEK EBITA margin, % 217Q2 Sales bridge Growth in MSEK and % +28% +9% +9% +4% +5% 1 7 1 674 66 1 6 54 1 5 111 1 4 131 1 312 217Q3 217Q4 218Q1 218Q2 8 7 6 5 4 3 2 1 1 Q2 217 Organic Acquisitions Trading days Currency Q2 218 9
Finland Highlights Q2 Good growth Sales up 15%, of which 5% organic Good overall market Strong growth for construction and industry Good demand for HVAC & P. and Tools & S. Initiatives to strengthen position in fast growing regions One acquisition signed within Tools & Supplies with ~35 MSEK in annual sales - Kahipa Oy Sales, EBITA and EBITA margin 1 8 787 789 824 727 651 6 4 2 1 34 45 25 14 217Q1 216Q4 216Q3 216Q2 216Q1 813 812 2.6 21 45 217Q3 217Q2 848 37 217Q4 937 83 3.2 16 3 218Q2 218Q1 1 9 8 7 6 5 4 3 2 1 Adj. EBITA down 9% Negative impact by increased sales level with weaker gross margin Operating expenses increased, partly due to investments in branch network and sales initiatives EBITA margin at 3.2% (2.6) Adj. EBITA margin at 3.2% (4.%) Adj. EBITA margin, % Net sales, MSEK EBITA, MSEK EBITA margin, % Sales bridge Growth in MSEK and % 95 9 85 813 4 12 +15% +5% +2% +2% +7% 14 58 937 15 Q2 217 Organic Acquisitions Trading days Currency Q2 218 1
Denmark and Other - Highlights Q2 Denmark Sales up 22%, of which 11% organic Strong refrigeration business driven by higher prices for refrigerants DIY business stable +2 trading days vs. comparative period EBITA margin strong at 16.% (1.3) Sales, EBITA and EBITA margin 14 122 12 1 93 95 96 1 98 11 88 88 89 16. 8 6 1.3 4 2 7 9 1 6 8 1 11 13 11 2 218Q2 218Q1 217Q4 217Q3 217Q2 217Q1 216Q4 216Q3 216Q2 216Q1 25 2 15 1 5 Adj. EBITA margin, % Net sales, MSEK EBITA, MSEK EBITA margin, % Other Sales, EBITA and EBITA margin Sales up 31%, of which 24% organic Strong organic growth in all regions Good market conditions Successful activities to increase sales efficiency and broaden the product offering Adj. EBITA margin at 3.4% (2.3) 15 1 5 82 1 93 2 12 4 115 2 95 1 11 2.3 3 135 6 126 3 143 19 3.4 2 5 5. 4. 3. 2. 1.. 218Q2 218Q1 217Q4 217Q3 217Q2 217Q1 216Q4 216Q3 216Q2 216Q1 Adj. EBITA margin, % Net sales, MSEK EBITA, MSEK EBITA margin, % 11
12 Financials
Sales, profitability and cash conversion Net sales 211 218 Q2 (SEKbn) Profitability 211 218 Q2 (SEKbn) Cash conversion 211 218 Q2 (Operating cash flow / EBITDA) 35 3 25 2 2,4 2,6 2,4 21,8 22,6 24,6 27,5 29,3 3 2 4 1 8 8,% 7,8% 8,8% 8,1% 8,3% 8,7% 8,8% 8,7% 1% 8% 6% 72% 91% 112% 9% 92% 9% 78% 7% 12% 15% 9% 75% 6% 15 1 2 4% 45% 1 5 6 2% 3% 15% 211 212 213 214 215 216 217 218 Q2 211 212 213 214 215 216 217 218 Q2 % 211 212 213 214 215 216 217 218 Q2 % Net Sales Adj. EBITA Adj. EBITA margin EBITA margin Cash conversion Target 13 Q2 218 is a RTM figure (Rolling twelve months)
Other performance measures Leverage External net debt/adjusted EBITDA 218 217 216 Q2 RTM Jan-Dec Jan-Dec 2.9 2.6 3.3 Equity/Assets ratio, % 35 36 34 Investments, % of sales.8.8.6 Average working capital, % of sales 9.7 8.8 8.9 Return on operating capital, % excluding intangible fixed assets 68 73 67 Return on equity, % 18 17 15 Return on working capital % 89 99 94 Basic earnings per share, SEK 3.74 3.28 1.11 Dividend na 1.65.35 14
Near term outlook Overall demand is expected to remain favourable for Ahlsell in the coming quarters Strong demand within industry and infrastructure Increasing activity level in renovation Remained high activity level within new construction, despite declining building starts in new residential Johan Nilsson, CEO 15
Registration open! www.ahlsell.com/cmd218 Capital Markets Day September 4, 218 Stockholm 16
17 Q&A
18 Appendix
Q2 overview 218 217 218 217 RTM 217 Q2 Q2 H1 H1 FY Net sales, MSEK 8,56 6,818 18% 15,217 13,387 14% 29,315 27,484 Operating profit, EBIT 582 471 24% 1,43 913 14% 2,172 2,43 Profit (EBITA), MSEK 678 558 21% 1,231 1,88 13% 2,537 2,394 Adjusted EBITA, MSEK 678 57 19% 1,231 1,99 12% 2,537 2,45 EBITA margin, % 8.4% 8.2% 8.1% 8.1% 8.7% 8.7% Adjusted EBITA margin, % 8.4% 8.4% 8.1% 8.2% 8.7% 8.8% Profit after tax (profit for the period), MSEK 57 38 64% 831 643 29% 1,616 1,428 Diluted earnings per share, SEK 1.18.71 1.93 1.47 3.74 3.28 Operating cash flow 429 39 39% 636 735-13% 1,893 1,991 Operating cash flow/ebitda (Cash conversion) 7% 78% External net debt/adjusted EBITDA 2.9 2.6 Sales, EBITA and EBITA margin 1 8 6 4 2 8 56 7 66 6 92 6 818 7 161 6 344 6 568 6 492 5 48 5 88 8.2 8.4 397 56 538 563 53 558 597 79 554 678 218Q2 218Q1 217Q4 217Q3 217Q2 217Q1 216Q4 216Q3 216Q2 216Q1 Adjusted EBITA margin, % Net sales, MSEK EBITA, MSEK EBITA margin, % Organic growth, % 16 14 12 1 8 6 4 15 1 5 9% 8% 8% 5% -5-1 -15 218Q2 218Q1 217Q4 217Q3 217Q2 217Q1 216Q4 216Q3 216Q2 216Q1 215Q4 215Q3 215Q2 215Q1 214Q4 214Q3 214Q2 214Q1 Group Sweden Norway Finland 19 RTM = Rolling twelve months
Condensed Income Statement 218 217 218 217 Rolling Full year MSEK Apr-Jun Apr-Jun Jan-Jun Jan-Jun 12 months 217 Net sales 8,56 6,818 15,217 13,387 29,315 27,484 Cost of goods sold -5,94-4,994-11,155-9,778-21,438-2,62 Gross profit 2,116 1,825 4,62 3,68 7,876 7,423 Selling expenses -1,431-1,257-2,87-2,493-5,276-4,962 Administration expenses -123-17 -238-22 -473-455 Other operating income and expenses 2 1 26 19 45 38 Operating profit, EBIT 582 471 1,43 913 2,172 2,43 Net financial items -46-62 -87-76 -22-29 Profit before tax 536 49 956 837 1,952 1,834 Income tax -29-11 -125-195 -336-46 Profit/loss for the period 57 38 831 643 1,616 1,428 Attributable to - Owners of the parent company 57 38 831 643 1,616 1,428 - Non-controlling interests Basic earnings per share, SEK 1.18.71 1.94 1.47 3.74 3.28 Diluted earnings per share, SEK 1.18.71 1.93 1.47 3.74 3.28 2
Condensed Balance Sheet 218 217 217 MSEK 3 Jun % 3 Jun 31 Dec ASSETS Customer relationships 3,2 11% 3,86 2,929 Trademark 3,837 14% 3,837 3,837 Goodwill 7,836 29% 7,64 7,26 Other intangible assets 149 1% 131 136 Property, plant and equipment 91 3% 797 853 Financial assets 13 % 78 1 Deferred tax assets 9 % 7 8 Total non-current assets 15,756 58% 15,2 14,98 Inventories 4,174 15% 3,36 3,888 Trade receivables 4,384 16% 3,6 3,491 Other receivables 1,434 5% 1,143 1,22 Cash and cash equivalents 1,355 5% 957 1,295 Total current assets 11,348 42% 9,6 9,894 TOTAL ASSETS 27,14 1% 24,61 24,874 218 217 217 MSEK 3 Jun % 3 Jun 31 Dec EQUITY AND LIABILITIES Equity 9,49 35% 8,568 9,4 Non-current interest-bearing liabilities 8,87 32% 7,93 7,934 Provisions 56 % 56 55 Deferred tax liabilities 1,42 5% 1,392 1,494 Other non-current liabilities 41 % 27 29 Total non-current liabilities 1,36 38% 9,45 9,512 Current interest-bearing liabilities 57 2% 328 51 Trade payables 5,627 21% 4,78 5,218 Provisions 8 % 19 1 Other current liabilities 1,246 5% 961 1,79 Total current liabilities 7,388 27% 6,88 6,358 TOTAL EQUITY AND LIABILITIES 27,14 1% 24,61 24,874 21
Condensed Cash Flow Statement 218 217 218 217 Rolling Full year MSEK Apr-Jun Apr-Jun Jan-Jun Jan-Jun 12 months 217 Profit after financial items 536 49 956 837 1,952 1,834 Adjustments for non-cash items 137 158 263 266 56 563 Tax paid -68-64 -232-29 -226-23 Cash flow from operating activities before changes in working capital 66 53 987 894 2,286 2,193 Change in inventories 75-13 45-58 -387-489 Change in operating receivables -86-231 -861-598 -811-547 Change in operating liabilities 498 129 251 322 632 73 Cash flow from changes in working capital -232-231 -566-334 -565-333 Cash flow from operating activities 373 271 421 56 1,721 1,861 Cash flow from investing activities -98-132 -81-256 -1,86-541 Cash flow before financing activities 275 139-381 35 634 1,32 Dividend paid -78-153 -78-153 -78-153 Issued warrants 1 1 1 Repurchase of shares -369-369 Proceeds from borrowings 75 1,225 2,224 999 Repayment of borrowings -54-46 -86-46 -1,392-1,712 Cash flow from financing activities -12-559 432-559 -244-1,235 CASH FLOW FOR THE PERIOD 263-419 51-254 39 86 Cash and cash equivalents at beginning of period 1,88 1,375 1,295 1,29 957 1,29 Exchange differences 3 1 9 2 8 Cash and cash equivalents at end of period 1,355 957 1,355 957 1,355 1,295 22
Market development GDP growth Per country, fixed prices, calendar-adjusted 5 4 3 2 1-1 -2 1,21,1 -,8 2,7 2,1 -,6 4,3 1,8,1 3, 1, 2,3 2,7 2,5 2,5 2, 2,9 1,8 1,9 1,9 1,9 213 214 215 216 217 218e 219e Sweden Norway Finland Industrial indicators Sweden PMI 54.2 (62.4) Norway PMI 55.8 (56.1) Finland Manufacturing confidence 14 (9) Manufacturing next 3 months 26 (22) Total construction investments Infrastructure, residential and commercial, index 215=1 14 12 1 8 6 4 2 119 121 122 118 118 118 12 19 19 11 1 1 1 Sweden Norway Finland 215 216 217 218e 219e 23 Konjunkturinstitutet 218-7-16, konj.se Sweden: Swedbank & Silf, Source: The Swedish Construction Federation Norway: DNB & Nima For Norway and Finland: Sveriges Byggindustrier Nordisk Byggkonjunktur 217-218 - 218-1-24 Finland: Confederation of For Sweden: Sveriges Byggindustrier Byggkonjunkturen 218-3-22 Finnish industries
Shareholders 218-6-3 sorted by Euroclear s official share register for directly and trustee registered shareholders + known custody names Investor Name Position % 1 CVC / Keravel SARL 19 578 323 25,1% 2 Norges Bank 19 845 748 4,5% 3 AMF Försäkring 18 87 4 4,1% 4 JP Chase NA 17 51 69 3,9% 5 Odin Fonder 12 1 2,8% 6 Alecta Pensionsförsäkring 11 2,5% 7 SEB Investment Management 1 87 694 2,5% 8 Handelsbanken Fonder 7 775 1,8% 9 Swedbank Robur fonder 7 431 948 1,7% Ahlsell AB 7 1,6% 1 Afa försäkring 5 686 654 1,3% 11 Kirkbi Invest 4 941 161 1,1% 12 Nordea Investment Funds 4 885 354 1,1% 13 Lannebo fonder 4 387 1,% 14 Andra AP-fonden 4 294 577 1,% 15 Folksam 3 685 268,8% 16 JP Morgan Bank Luxembourg 3 643 46,8% 17 Danica Pension 3 399 897,8% 18 Profun Förvaltning 3 46 956,7% 19 Catella Fondförvaltning 3 8 398,7% 2 Skarvhagen Förvaltnings AB 2 9,7% 21 Kuwait Investment Authority 2 766 27,6% 22 Nordea 2 423 428,6% 23 Tredje AP-fonden 2 196 872,5% 24 Threadneedle LUX 1 895 986,4% 25 Kammarkollegiet 1 582 893,4% 26 Bodenholm 1 411 814,3% 27 Skandia Fonder 1 397 766,3% 28 Berenberg Gossler 1 226 333,3% 29 Länsförsäkringar fondförvaltning AB 1 133 975,3% 3 SPP fonder 1 13 831,3% Other 154 616 58 35,4% Shares outstanding 436 32 187 1% % of capital Sweden Luxembourg UK US Other 13% 3% 14% 15% 28% 24
Trading days 217 Q1 Q2 Q3 Q4 H1 H2 FY Sweden 64 59 65 63 123 128 251 Norway 65 58 65 63 123 128 251 Finland 64 6 65 62 124 127 251 Denmark 65 58 65 63 123 128 251 218* Q1 Q2 Q3 Q4 H1 H2 FY Sweden 63 6 65 62 123 127 25 Norway 62 6 65 62 122 127 249 Finland 63 61 65 62 124 127 251 Denmark 62 59 65 62 121 127 248 219* Q1 Q2 Q3 Q4 H1 H2 FY Sweden 63 59 66 62 122 128 25 Norway 63 58 66 62 121 128 249 Finland 63 6 66 62 123 128 251 Denmark 63 57 66 62 12 128 248 25
Merger & Acquisitions 217-present Closing Acquisitions Country Product segment Annual sales SEK million a Number of employees b 28/2/217 G-ESS Yrkeskläder AB Sweden Tools & Supplies 12 37 Strengthen position in professional workwear position in the Stockholm area 2/5/217 C.J. Järn & Maskin AB Sweden Tools & Supplies 46 18 Strengthens position in the region of Vårgårda. Good opportunities for cross-selling to mainly industrial customers Rationale 1/6/217 Svensk Industri & Kommunservice AB Sweden Tools & Supplies 55 13 Attractive customer base with many customers within public administration. Broaden offer in PPE. 2/1/217 Lenson Elektro AS Norway Electrical 23 5 Increase exposure to electrical installations such as power, lighting and climate. 1/11/217 ViaCon VA (assets and liabilities) Sweden HVAC & Plumbing 32 81 Valuable expertise in Water & Sewage operations. Strengthens initiatives to attractive customer segments. 1/12/217 Gehås AB (assets and liabilities) Sweden Tools & Supplies 15 6 Strengthen position within PPE in Värmland 4/12/217 Infästningsspecialisten Göteborg AB Sweden Tools & Supplies 28 8 Strong position within fastening solutions and related tools to SMID customers 28/12/217 Nordic Sprinkler AB, Enexia AB, Prepipe Construction AB Sweden HVAC & Plumbing 8 21 Ahlsell is a relatively small player in sprinkler systems, and the acquisition will strengthen our presence 28/12/217 Enexia Oy Finland HVAC & Plumbing 4 8 Same as Nordic Sprinkler 29/12/217 Jobline i Umeå AB Sweden Tools & Supplies 26 8 Strengthen position within PPE in Umeå and surroundings, north of Sweden 29/12/217 SAFE Workwear Sweden AB Sweden Tools & Supplies 24 9 Safe Workwear strengthens our presence in both Stockholm and the region of Mälardalen 217: 777 MSEK 16/1/218 Proffsmagasinet AB Sweden Tools & Supplies 26 5 Leading Nordic e-commerce business - we get further knowledge on new ways of meeting professional customers 1/2/218 HMK i Västerås AB Sweden Tools & Supplies 16 8 Wide range of well-known brands in workwear and personal protection in Västerås 2/2//218 Bekken & Strøm AS Norway Tools & Supplies 415 16 Leading Norwegian supplier of workwear and personal protective equipment (PPE) 2/5/218 Sentrum Motor och Verktøy AS Norway Tools & Supplies 4 9 Gives Ahlsell a strong foothold in Tools & Supplies and improves the conditions for growth within HVAC & Plumbing in the Finnmark region 31/5/218 Bygg & IndustriPartner Skaraborg AB Sweden Tools & Supplies 3 7 Strengthen position in tools and supplies in Skövde with surroundings 2/7/218 Kahipa Oy Finland Tools & Supplies 35 7 Gain specialist competence within HVAC brackets in Southern parts of Finland 218 YTD: 796 MSEK 26 Full list of acquisitions can be found on www.ahlsell.com
Introduction to the presenting team Johan Nilsson CEO Appointed Group CEO in 215 CEO Ahlsell Sweden 28-215 Joined Ahlsell in 28 Previously: CCO of Sanitec, CEO of IFÖ Sanitär and IDO Kennet Göransson CFO Joined Ahlsell in 214 Held equivalent positions with Indutrade, Addtech and Bergman & Beving Karin Larsson Head of IR Joined Ahlsell in 217 Previous positions: IRO at Atlas Copco Stockholm, equity sales at SEB Enskilda and Baclays capital, Frankfurt 27
Disclaimer Some statements are forward-looking and the actual outcome can be different. In addition to the factors explicitly commented upon, the actual outcome may be affected by other factors such as macroeconomic conditions, movements in foreign exchange- and interest-rates, political risks, competitor behaviour, supply- and IT-disturbances. 28